AHRI: U.S.-China trade war sparking HVAC&R price increases

In the wake of U.S. plans to roll out an additional 10% import tariff in September on 6,000 Chinese products, including HVAC&R products, AHRI (the Air-Conditioning, Heating and Refrigeration Institute) called the on-going trade war “disruptive” and said it is leading to price increases.

“Our position remains the same – the tit-for-tat tariff situation is disruptive to the business cycles of our members, to the global supply chain, and also to negotiations on treaties like NAFTA,” said Francis J. Dietz, vice-president, public affairs at AHRI. “Many of these tariffs have forced our members to raise prices to cover the increased cost of raw materials, which is unfortunate.”

Dietz added that “our industry remains vibrant and strong, but the longer this situation persists, the more negative the effects on U.S. industry.”

The 6,000 additional products, worth an estimated $200 billion, include Chinese exports of air conditioners, heat pumps, refrigerators, two types of ammonia (anhydrous ammonia and ammonia in aqueous solution), HVAC&R components and some HCFCs.

“We were prepared for this and have been analyzing the list and engaging with our members on at least a weekly basis,” Dietz said.

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Many of these tariffs have forced our members to raise prices to cover the increased cost of raw materials."– Francis J. Dietz, vice-president, public affairs, AHRI

The list of 6,000 items, which also include fish, minerals and chemicals, comes just days after another round of tariffs had been announced by both the U.S. and China on each other’s products.

The U.S. has targeted Chinese solar panels and washing machines, while China has placed taxes on “cars, soya beans and lobsters,” according to the BBC.

The trade war between the U.S. and China began in February after the U.S. Commerce Department announced the imposition of import duties on steel and aluminium at a rate of 25% and 10% respectively. It was widely condemned by the industry at the time including AHRI, as reported on this website.

"As major users of steel and aluminum, we have been proactive in explaining to the administration that the HVAC&R and water heating industry would be negatively impacted by an increase in tariffs, as would the consumers that rely on the products we manufacture," AHRI President and CEO Stephen Yurek said in a press release at the time of the February announcement.

The 10% tariffs on the 6,000 new products in September still require feedback from the public (the deadline is 17 August for written comments). Comments can be submitted through the Federal eRulemaking Portal: www.regulations.gov by following the instructions in sections D and F. The docket number: USTR-2018-0026 also needs to be used. There will also be a public hearing from 20-23 August 2018 in Washington D.C. August 30th is also set as the date for “post-hearing rebuttal comments”.

President Trump maintains his administration is trying to protect U.S. jobs and stop "unfair transfers of American technology and intellectual property to China," according to the BBC.

China disagrees, and responded in the state-run newspaper China Daily that, "the Trump administration is behaving like a gang of hoodlums with its shakedown of other countries, particularly China". The U.S. has also placed tariffs on EU and Canadian goods, wih both jurisdictions responding by taxing U.S. imports into their markets.